in the model with utilitieswi ci alpha, Business Economics

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in the model with utilitieswi ci alpha

In the model with utilities

Wⁱ = cⁱ + α ln(xⁱ)

where individuals are endowed with ability levels w_p < w_m < w_R and form fractions π_p, π_m, π_r with π_m > π_p, π_r such that the median person is in group m.

Find the median voter eqm.
Now consider a situation where w_p falls. What changes at eqm?
What if wm rises?

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Business Economics: in the model with utilitieswi ci alpha

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Business Economics: in the model with utilitieswi ci alpha

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